In America, Bill Clinton said vote for one, and you get two - a centrist Bill and a leftist Hillary. Sounded like a good idea at the time, until Hillary turned her attention to healthcare and devised a scheme so Stalinist as to repel voters. In Britain, Tony Blair, stumbling in his bid for re-election, belatedly turned to his chancellor to manage his last hurrah, and promised that if you vote for one, you get two, a centrist Tony and a leftist Gordon. Then Gordon Brown turned his attention to healthcare. The rest, as they say, is history: a ton of money, lavished on an unreformed Stalinist system, has produced an ounce of efficiency, dragging down the nation's productivity just when the chancellor is proclaiming Britain's need to remain competitive with China, India and other nations.

Worse still, the result of the Dunfermline election was grist to the mill of those, many in the prime minister's entourage, who argue that the ageing, voter-unfriendly Brown will be no match for the young, voter-friendly David Cameron. With the electorate ageing, and therefore likely to give more weight to experience than to promises, that thesis remains to be proved.

Brown's problem is neither his age, which hardly brings him to the verge of decrepitude, nor his personality, which is far more agreeable than the Tories are making out. While lacking Cameron's easy ability to discuss publicly his preferences in undergarments, he projects vigour, intelligence and competence, and parades a record of achievements of which he is proud.

In some cases rightly so. The economy has grown at a rate that any reasonable observer would consider satisfactory: interest rates are low, inflation is low and employment is high. Brown's critics are reduced to crying "apocalypse later" as they wait for the budget deficit, or the trade deficit, or rising unemployment, or problems in the high street to bring him down.

Meanwhile, Cameron has put the Tories back in the game by parading his green credentials, his suspicion of big business, his preference for a timetable for withdrawal from Iraq and a pledge to continue expanding the public sector, before a public fed up with Labour's inability to deliver safer, cleaner streets and a health service that meets their rising expectations - rising because patients are more knowledgeable, and because they were promised that the multiple tax increases with which they were to be afflicted would produce quicker, better care. Most of all, Cameron has offered his persona - a relaxed, new face, the very model of a modern major politician, a liberal conservative, as he styles himself in his most recent incarnation.

Which brings us to the problems that Cameron faces. All of the things he is for, Brown can say he has addressed. Cameron wants a greener Britain; Brown has been there, done that, with his climate change levy - flawed, to be sure, by considering nuclear energy as polluting as fossil fuels. Cameron favours a more robust military; Brown has already taken care of that by increasing the defence budget in real terms: it is now about 4.4% higher than in 1997/98, and will be 7.5% higher by 2007/08.

Cameron wants more regulation of business so that it will be more socially responsible. He will have difficulty finding a regulation the chancellor has not already imposed. Cameron wants education reform. Brown will have done that, or at least tried, by the time of the next general election. Neither wants to give parents the freedom of choice that a voucher programme would provide. Cameron wants lower taxes - oops, that has been dropped from the new Conservative agenda, leaving the chancellor invulnerable where he should be most easily challenged. There is more, but you get the idea: there is little difference between Gordon Brown and David Cameron when it comes to their goals for Britain. Both want a greener, safer, more competitive Britain, with jobs for all and a safety net for those who are unable to take care of themselves.

The chancellor's problem is that his notion of how to achieve these goals is more redolent of old than of New Labour. Had Brown been known to Ronald Reagan, the late president might have had him in mind when he said, "The government's view of the economy could be summed up in a few short phrases: if it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidise it."

Brown quite correctly sees China and India as threats to Britain's long-term competitiveness. His solution is to establish a government-funded design centre, just the sort of thing the Chinese are now moving away from. He properly worries that the nation's international competitors are turning out more talented graduates, but opposes an increase in private funding of university education lest the government should lose control. He knows that the nation's material wellbeing depends on its ability to increase its productivity, yet directs a larger and larger portion of its limited resources into the least productive sector of the economy, the public services - having abandoned his promise of reform first, money later.

The reason that the British economy may be seizing up is that the chancellor has moved it ever closer to the continental European model. Holger Schmieding, chief European economist at the Bank of America, noted this "fiscal convergence" between Germany and the UK and told the Observer that Brown's policies have "put Britain firmly in the European camp and moved it away from the US".

The Treasury now claims just about as much of the nation's income as does Germany's; projections suggest that Britain is one of the few economies in the world in which the overall tax burden is rising rather than falling; since 2000, public sector employment has risen by 10.2%, compared with only 3.6% for the private sector. And that excludes GPs, consultants and employees of Network Rail.

It should come as no surprise that higher taxes, most recently retroactively levied on the oil industry, have deterred private investment, and for the first time in a long time reduced the rate at which new businesses are formed to below the rate at which they exit the economy. And it should not come as a surprise that the relative increase in public sector employment, where workers are virtually free of compulsions to perform while waiting for their generous pensions to arrive, has dragged down the economy's overall productivity, even after recent revisions.

That said, Gordon Brown has a major advantage over David Cameron. He knows where he wants to take Britain and knows how he wants to get there. Cameron may also know where he wants to take Britain, but so far he has not offered an alternative to the chancellor's failing methods of reaching the promised land of rising living standards. And he runs a huge risk: if the empiricist in the chancellor wins the battle with the ideologue in him, the chancellor might just make a mid-course adjustment that combines his laudable ends with effective means in an electable combination.

Irwin Stelzer is the director of economic policy studies at the Hudson Institute and the editor of Neoconservatism